Sales indicator August 2021 © Holzkurier.com
In August, the sales indicator was at 221.8%. The change compared to July, i.e. -17%, is the biggest month-on-month decrease since the sales indicator was introduced in 2006.
With the exception of pellets, all products covered by the sales indicator recorded decreases, such as the US price which fell by 34% and saw the biggest change.
Stashing completely underestimated
“What we are doing now is managing the lack of orders,” one glulam producers said pointedly in an interview. This development is mainly attributed to full warehouses. Apparently, producers completely underestimated how much carpenters and merchants stashed in the first half year. This “panic buying” now acts as a stabilizing factor in times when a lot is produced but little is ordered.
Delivery times for glue-laminated timber have reduced drastically. Currently, all products normally arrive within a maximum of three weeks. Since buyers take their time with new orders when prices are falling, there is a further decrease in orders. As for glue-laminated timber, Holzkurier identified a price range of €800 to €860/m³ in August, which is around €50 less than in July. However, considering that one big producer announced September prices of over €1000/m³ in June, it is a significant decrease.
€600 possible, €1,000 unlikely
While prices increased week after week in the first half year, they are now falling at the same pace. Also, strictly speaking, there is no real market price at the moment. Glulam is currently sold for €700 to €900 and more. In October, glulam is more likely to cost six hundred and something than €1,000.
The decrease in orders was also fueled by company holidays of many craft businesses in July and August. One the one hand, they did not know about the further development of prices, on the other hand, their employees had accrued a lot of overtime and many vacation days.
The further development of glulam prices is not clear yet. In general, market participants expect construction activity to remain strong. Now, the key question is how long it will take for stock levels to decrease. When they are high, nobody is interested in falling prices. At the same time, producers can only produce for stock for a certain time. At some time, though, goods “have” to be sold.
Quotes from market interviews
“So far, customers have been buying because they knew that products would be even more expensive next week. Now, it’s the other way around: They don’t buy because prices are falling.”
“During summer, prices fell by the amount that was added to the span we had calculated.”
“Log wood deliveries are excessive.”
“With the usual €400/m³, glulam has always been simply too cheap.”
“Those who have been offering their goods for the highest price are now desperate for orders.”
“What we are doing now is managing the lack of orders.”
Lamination price down by 8%
The end product glulam has lost 6% in value compared to July, while prices of laminations for glulam have fallen by 8% or €40/m³. Holzkurier identified a price range of €460 to €490/m³ for fresh laminations for glulam free German bulk buyer. In August 2020, laminations cost between €179 and €186/m³. All of these prices have to be paid when placing new orders. However, many laminated timber producers have older supply contracts. For them, purchase prices could continue to rise in the coming weeks. Stand-alone production sites without their own sawmill are mainly affected by this.
As for lumber, it is also very difficult for buyers and sellers to plan ahead since there are big uncertainties about prices. At least, all softwood lumber products are now available. Many buyers were not used to receiving stocklists anymore. Now, they are being sent out again.
